Sunday, July 31, 2011

Who's Crazy Now?

This week has seen some interesting praise for Libertarianism from some strange sources (here and here). Reading these was very interesting, though the motive for them seems quite clear, that the Republican party needs to embrace those with Libertarian leanings to expand and ensure a governing majority. While the articles were good, what was really telling were the comments by the readers. What was interesting was the hardcore conservative reactions, which attempted to lambaste Libertarianism as a philosophy, and ill-suited to be part of their coalition. You see similar things (albeit on the other side of the ideological spectrum) from Liberal pundits and commentators when they talk about Libertarians. It is always fascinating to see how Libertarians are not allowed to have a “tent” like the predominate political parties and philosophies. “Libertarian” almost always gets boiled down into a fringe idea not to be taken seriously, an academic exercise without real world applicability. When you synthesize the criticism from both sides you have painted a picture in which all Libertarians are atheist, anarchist, isolationist, selfishly wishing to abolish the local fire department and set destitute granny out on a glacier to die, all while preaching from their well worn copy of The Fountainhead. Libertarians are not allowed to have a diversity of thought, and more importantly not allowed a place at the table. Somehow the Liberals and Conservatives are able to paint Libertarians as the ones who are too ideologically rigid to compromise, to be part of the discussion and have input on the future direction of the country. Given what we are all seeing with the debt limit debate this seems beyond laughable. When most Americans actually examine their beliefs (take the test here and see where you fall) they see that these two labels and those that define them do not really speak for the country as a whole. Libertarians can find common ground on many issues within both groups, yet disagreeing over centrally held tenants of either somehow makes alliances and compromise impossible. Who is being to rigid and ill-suited to governance at that point though?


In practice we usually see Libertarian leaning politicians form alliances and find a home in the Republican Party, yet there is a gulf between them and conflict usually arises over the issues of moralizing and the national security state. The Burkean conservatives within the Republican Party and their desire to protect “traditional” values usually leads to problems with Libertarians. Christian nationalists hold a large influence over the Republicans, and everyone who wants to run for the Republican presidential nomination must address this issue, make proclamations of faith and discuss how important religion is in their life and how it will influence their political decisions. You here the phrase “Christian Nation” and our “Judeo-Christian legal system” based on traditional morality. On a personal note I have never understood the latter notion. Once you get past “don’t kill people or steal their shit” I don’t see any real “Christian” design to our legal system, and it has never been explained how those are fundamentally “Judeo-Christian” concepts and values, they are pretty much universal concepts of man. This moralizing leads to conflict in areas of abortion, the drug war and free-speech and many other policy areas. Libertarians have a desire for the maximum freedom and limited government, allowing people to make their own decisions when it come to what they watch, read, practice and ingest. For those in the Republican Party who believe that the Bible rightly prohibits certain behavior, and that government should take it’s cue from those mores, there is going to be serious conflict with Libertarians. In terms of the national security state, the “neo-cons” have grand issue with Libertarians. National Defense is an important core constitutional duty of government, but shouting down questions about what, where and how we are doing things in this area does not make you naïve to the ways of the world or an isolationists. Libertarians, generally, want a strong national defense capability, but they want to see it properly maintained and deployed. Spending large amounts of money does not automatically make you safer. This country spends a ridiculous amount on defense, more than most of our possible threats combined in real dollars and as a percentage of GDP. Is that money being spent wisely? That is a fair question. We have bases and troops all around the world in order to project power and defend allies against non-existent threats. You saw the conservative hawks and their peculiar notion of American National Security interest on full display during the “Arab- Spring”. For decades the U.S. has propped up dictators all over the world, initially in our global Cold War chess game with the Soviets, and more recently in our “War on Terror”. When the people of Egypt rose up to depose one of these brutal autocrats, attempting to secure for themselves what we in this country have always claimed is one of the most important and cherished principles of humanity, self-determination in their lives and government, what did the pundits and politicians on the Conservative hawk side say? That we were making our country less safe, that we should be supporting Mubarek in his attempt to violently quash his people’s desire to be free from his evil and corrupt regime. If provided the opportunity to choose their own government, Egyptians might choose wrong, and destabilize the region. We see the same thing at home when questioning the PATRIOT ACT and the notion of keeping us “safe” from all the evils of the world. Once again, from a personal level, if you are going to tell me we can’t survive without warrentless wire-tapping, government access to all phone, internet and business records, paid informants and FBI agents entrapping every feckless 19 year old malcontent who posts the wrong thing on Facebook, extraordinary rendition and water-boarding my response is always going to be the same: Let the Republic fall then, because this is not what we are supposed to be about as a nation or a people. Granting governments the power and access they claim is needed to make us safe does not sit well with Libertarians. When you make the leap that it is ok in this situation, when dealing with those scary foreign types, you set the foundation for future abuse. Conservative TV pundits will rail on and on how the government can’t be trusted with your money, your business practices or a host of other issues. Yet in the very next breath they will gladly allow the CIA, of any government entity you could pick, the power to decide who is guilty and has relevant information to be water-boarded out of them. No over-sight, no indictment, just get it done for the good of the whole. Who exactly is the crazy one in this conversation?
The Liberal Democrats don’t often form alliances with Libertarians even though there is so much common ground in terms of civil liberties and other areas. Like Conservatives, Liberals can often see the Constitution as an impediment to implementing their “moral” agenda. Libertarians usually view the constitution through the same prism regardless of the issue. Free speech is the most important tenant of our society, and it must be protected at all times, regardless of the speaker. When the Citizens United decision came down Liberals lambasted it as an end to our system, with the corporation now able to buy the whole thing, and the evil Conservative Supreme Court handed us all over to their greedy hands. They never seem to mention that the ACLU was involved in this case from the beginning, that they and others can’t couch to the notion that government should dictate how and when speech should be allowed. You see the other rifts develop over the welfare state and a desire to let capitalism and markets enrich the lives of people. We live in a time where the welfare state is driving every industrialized country into debt, and all are reexamining the scope and utility of the programs. In this country it is sacrilege for Liberals to speak of reforming the system, it must be maintained (if not expanded) now and always, and for any group to mention reform means they want to send seniors and the poor into a spiral of deeper poverty and early death. Libertarians selfishly lack compassion for those less fortunate amongst us, and Granny needs to be protected from these evils. This plays nice in fund raising letters and commercials, but it does not solve any problems, and problems are what we face right now. I have heard pundits talk about fulfilling promises and the social contract we have created. Problem is that the promises are going to drive us into unsustainable levels of spending, and if we do not reign it in then there will be no society to speak of. There are some that talk about ending the system completely, that is true, the same as there are Liberals who talk of expanding and increasing the welfare state to match European models and levels, and that is not going to happen either. There needs to be a discussion and an eventual compromise about a sustainable future model and what it will look like. This often leads to the discussion of markets and capitalism and the other large point of contention. Libertarians, according to the Liberals, would turn America over to the ravages of capitalism bringing back 20 hour work days for 8 year olds and allowing the corporations to pour toxic waste into your bathtub. Again, the most extreme and unlikely outcome is used to short circuit debate and compromise. Yes, Libertarians usually place trust in capitalism and markets, because this will usually bring about the best outcomes for people. Problems? Of course, the market has no conscience, it does not care about you. Governments have attempted to blunt and control these outcomes, but this has not always led to the intended goals. We often see the crash of 2008 used as a repudiation of capitalism and deregulation, that there needs to be tighter controls of the system. How anyone can use 2008 as an example of this is somewhat ridiculous. Democrats and Republicans have spent decades gaming the system for their constituents, using the tools of government to cover all the bases, and ending up covering none. Rent-seeking banks and corporations that have regulations written in their favor so they face no consequences for their stupid decisions is not capitalism. When the bail-out bills were being debated both parties were almost universal in their calls for the absolute paramount need for government intervention. What did the Libertarians, the Austrian Economists, the people with the faith in the markets have to say about it? F*#K ‘EM! They made these decisions, let them reap what they have sown. They were of course called the naïve ones, that the impending disaster was so cataclysmic that inaction was not an option. This of course examines the issue in a vacuum in which the banks had exhausted all possible avenues, there was no hope but government intervention, and we all dangled on the precipice with the only options being bail-out or Armageddon. The reality of course is that the banks had the regulating agencies captured, the lobbyist working full time and their pundits talking up the cable air waves. The result? Hundreds of billions of dollars was handed out to “save” the economy, but without any proviso that the banks had to lend the money. The only control the government ever tried to exert was over CEO salaries, at which point the banks paid back the money on the spot. Any of this seem like capitalism? It is exceptionally difficult to do business in this country because of government. Libertarians call for deregulation where it stifles competition and enriches rent-seekers. They call for choice and true competition. If you want to be a bank, be a bank, if you are going to be a casino, then you need to say that up front, and not be allowed to flip-flop when the tab comes due so you can collect a government check. Certain regulations (air and water pollution etc.) are acceptable to Libertarians, the problems usually occur in how governments enact regulations, and the unintended consequences they create. Having the discussion about the proper scope and reach of the government into the economy does not make you a corporate shill, it makes you concerned about how this country is going to compete in a world where capital is more fluid then ever, and the future of what we are going to have as an economy is on the line.
The title of the blog asks “crazy, naïve or just like you?” because that is at the heart of what is going on here. Don’t look for a badge to wear, an organization to belong to. Do the Liberals or the Conservatives encompass all you beliefs? Is there no area in which you might disagree? To be a Republican in New Hampshire is usually a very different thing then being one in South Carolina, the same way that being a Democrat in Massachusetts is different form one in Arkansas. Your support and your vote for a candidate should not be based solely on the letter after their name. Saying you are a Libertarian or have a Libertarian leaning in some regards should not automatically exclude you from the conversation. Doggedly holding to a single issue and disqualifying all who will not vehemently support that particular cause should be viewed as the crazy ones, shouldn’t they? This is a big country with a lot of different types of people and problems. We will never advance under one sole banner and philosophy, but only through debating and examining the issues at hand and all the possible solutions.

Thursday, July 28, 2011

The 14th Amendment: In Him We Trust

There are now more calls for President Obama to invoke what they are calling a “nuclear option” for the debt crisis using the 14th Amendment to simply raise the debt ceiling on his own. For the uninitiated they are talking about Article 4 of the 14th, the whole text reads as such:

The validity of the public debt of the United States, authorized by law, including debts incurred for payment of pensions and bounties for services in suppressing insurrection or rebellion, shall not be questioned. But neither the United States nor any State shall assume or pay any debt or obligation incurred in aid of insurrection or rebellion against the United States, or any claim for the loss or emancipation of any slave; but all such debts, obligations and claims shall be held illegal and void.The bold emphasis is mine, because this is the part they keep emphasizing. The notion is that the debt of the U.S. is valid and not to be questioned; the President in Article II Section 3 of the Constitution states “he shall take Care that the Laws be faithfully executed”; therefore the President is duty bound to simply raise the debt ceiling on his own to meet all the constitutional obligations of his office. Simple, right? What these geniuses never mention of course is Article 5 of the 14th, the part that comes outside of their ellipses:

The Congress shall have power to enforce, by appropriate legislation, the provisions of this article.The Congress, not the President, has the power of enforcing the provisions of this article, including Article 4, through legislation. Had the writers left out that bit you might possibly have an excuse for this nuclear option, but that is doubtful. The Constitution is awfully clear on this point, Congress runs the finances of this country, and the 14th does not alter this point. If you want to spend the peoples money, you have to go through Congress, and more specifically it must start in the people’s house.
It must be nice to have such overwhelming faith in one person. Back in the day Senator Obama stood on the floor of the Senate and had one of his grand little speeches about the debt ceiling and a “failure of leadership”. If W. had simply said “I’m a gonna raise that there debt thingy on my own” what would have been the reaction of these constitutional scholars and legislators calling for unilateral executive action today? You already now the answer to that question. The same counter-arguments and threats of impeachment would have been screamed high and low. Each side and their talking points would have been completely reversed, just switch the bylines in the articles and name banners on the cable news channels. The script would’ve been exactly the same. There in lies the ideological inconsistency of both these groups. How often in any policy debate have you seen the ideologue take refuge in “well when they had power they did it too” which is the highest art form of two wrongs make a right. They like to use the constitution as a prop. They are willing to either shred or embrace it depending on what is needed to advance their agenda.
The point of the Constitution is to create a national government strong enough to deal with national problems, yet limited enough to protect the liberty of the people. If they make the case today that the Executive can simply borrow and spend money on a larf, with no input from congress, what are they going to do when they are out of power and their political antithesis is about to do the same? Will they acknowledge they opened this can of worms? Will they stand there with a straight face and say it is different because it is the other guy? Is there any hope for the Republic if we all just say sure Mr. President, spend whatever you want? The point of all this garbage talk is to present an alternative to force the Republicans to do something in line with the President’s wishes, pass a debt ceiling increase through the 2012 election with no actual cuts in spending (meaning spending less money next year than last instead of having less of a budget increase than you expected). There is (at the moment) no real chance of this option being exercised, what is scary is how easily people who supposedly know something are willing to throw their weight behind this. To say and believe that your guy is smart enough and disciplined enough to make these decisions on his own, with no oversight, and we should just trust in him is terrifying. Emergencies are tough things to deal with, even manufactured ones like this, but flushing the whole system away on a leap of faith is even harder to swallow. Presidents have gained far too much power in our system in the last 75+ years, and we have come to look at the office in very unrealistic terms. Every problem, crisis, and emergency brings focus on the President and how that individual will personally lead us out of said issue. To provide the President with the unwritten power to simply create debt would be one more step towards making Congress, and ourselves, completely irrelevant.

Tuesday, July 26, 2011

The Debt Crisis: Let’s All Think About Getting Re-elected

We now have another set of competing proposals from the House and the Senate for avoiding the August deadline set for the debt debate. It is nice to see that Washington is so concerned with the issue that they are willing to throw out silly vagueries about what they will do sometime down the road, maybe, when we can get to possibly discussing making a cut or two to the Federal budget. To recap, we are $1.6T over budget this year. We are spending $1.6T more this year then we took in in revenue, and everyone is talking about what we will be doing over the next 10 years. For the Democrats in the Senate under Mr. Reid’s leadership, the plan is to cut $2.7T over 10 years without touching entitlements. A little over a Trillion is saved from the discretionary budget, and a Trillion is saved from ending the wars in Iraq and Afghanistan. On a first impression, anyone, Democrat or Republican, who was really planning on spending another Trillion or so dollars on Iraq and Afghanistan over the next 10 years should not only not be re-elected, they should be tarred-and-feathered (does that count as vitriolic hate speech?). If Defense is not first and center on any plan to reduce the deficit then it is meaningless, that is a given. Anything that does not address Medicare second is also a joke and should be treated as such. The plan allows the Democrats to minimize the debt and taxes issue in the 2012 election by raising the debt ceiling through 2013. It also allows them to say “we saved entitlements”. In this way Republicans can be painted as the evil un-compromisers willing to throw Granny under the bus. They can also keep raising taxes on the evil rich as an election issue by keeping the details to a minimum.
In the Republican plan we see their desire to keep the debt issue front and center through the election year. Raising the debt limit for 6 months puts the fight right in the beginning of the Presidential Primary season, allowing everyone running to sandbag political points off the debate. The news coverage of stump speeches relating to the debate will be worth tens of millions in free advertising. The White House will be fighting it from all sides, which of course is the point to each sides intransigence. It is all election metrics and nothing else. The Republican plan sets up this fight, and continues the attempts to whip up their base. The notion that in six months, in the middle of a Presidential election year, Republicans will stand up and say we need to cut Medicare and raise the Social Security eligibility age is at best ridiculous. The plan also makes the balanced budget amendment a center piece of the legislation. While it would be nice to have some sort of actual restraint on the power of the Federal government, this one is a non-starter and has been from the beginning. There is no chance for the amendment to get two-thirds of both houses of Congress. The point of the vote would of course be 30 second election commercials saying “Democrat X voted against a balanced budget amendment”. You also have the issue of turning the House into the Senate when it comes to budgets and taxes. The Senate and it’s rules serve a function to protect the Republic from the swings of the popular electorate, and that is a good thing. The House of Representatives though is the people’s house, and it should remain as such. The Republicans are really enjoying their place at the table because of a two year swing in popular opinion, and locking in budget and tax authority to a super-majority would have removed that. From a practical perspective, even if you could get the amendment through both Houses, there is virtually no chance of it passing three-quarters of the states. If you do not use the convention process, then you only need to convince the majority of one house in thirteen state (or the unicameral legislature in weird old Nebraska) that this is a bad idea. If you are not considering any particular rules in individual states then this means convincing less than 200 people that this is bad for the country. Not to difficult a proposition in the long run.
The President’s speech did little to change the metrics of this fight, mainly by not saying anything of any substance. The two issues of the debt ceiling and the long term deficit are intertwined at the moment. They will of course untangle these issues to vote on a debt limit increase, that is a given. The posturing makes for good TV and polling, but neither side is actually going to stand up and say lets really cut something of significance. To do so would then lock you in to a position, always dangerous going into an election cycle. Everyone’s posturing and playing to the base is the point of all this drama. The need for a real change in the structure of government spending should be blatantly obvious to everyone, but do not expect any change to the status quo tomorrow, or August 2nd, or in 6 months or 15 months from now. There is an election to win don’t you know, and that is what is important to them; because without complete and total super-majority control of our government by one party in our two-party system how could you actually expect anyone to govern?

Thursday, July 21, 2011

Libertarians and Gay Marriage

I stumbled upon this little gem from The American Spectator (which references a larger article here) today and it got me kind of raging. The basic premise of the article seems to be that Libertarians and Libertarian-minded Republicans are doing a disservice to First Amendment freedom by supporting the notion of Gay-Marriage. The gist is that people’s religious conviction to oppose gay marriage should be the first principle, and that all those who supposedly support the notion of liberty need to line up to support them, or else be hypocrites. The whole piece references instances of supporters of “traditional” marriage being discriminated against for speaking their mind and Catholic adoption agencies losing their tax exempt status for refusing to place children with gay couples. Now, if someone loses their job for some innocuous comment involving their religious beliefs, then there seems to be a great lawsuit there, but the rest of the article can’t really stand on its merits. The notion of wanting to protect “traditional” marriage is based on an ecclesiastical principle, and that is the problem with their argument. Marriage in this country is, first and foremost, a state sanctioned contract. You can have a priest, a parson or a voodoo witch doctor say whatever they want in front of you, but if that individual is not authorized by the state to officiate the ceremony, it does not mean anything to the state. Sure, your religious tenants have been satisfied, but the state and the legal ramifications involved with marriage have not been. Plain and simple - religious marriage and state marriage are two different things. The same applies for ending a marriage. An annulment or a Sharia Triple talaq does not end the civil commitment of marriage in this country, nor should it. Just because your religion does not like some aspect of the civil process does not mean public policy should be changed. The government exercising its function to protect someone’s civil rights in contradiction to your religious beliefs is not an infringement on your First Amendment rights. The same applies to adoption agencies. Adoption is a state sanctioned function. If a nun showed up at your house and randomly handed you a baby, do you think the government would just say “Sure, you’re a parent now”? If you are an ecclesiastical organization operating in a secular arena, then the secular must win out. When they started this organization, they probably had to agree to those terms up front to get into the field and receive their tax exempt status.
The article goes on to say that gays can go about and live happily in all 50 states, and that should be good enough for them and leave marriage out of it. The problem with this line of reasoning are the rules people like these authors have put in place to actually inhibit, if not prevent, that reality. The problem for cohabitating gays has always been to attain the same level of legal protection as married heterosexual couples. In terms of insurance, property rights, inheritance and death and burial decisions, gays have always been at a disadvantage. If you are gay and spent 25 years living with one person, who do you think you would want making the decisions about your health and your estate should something unexpected happen? Until the concept of Civil Unions came around, it did not matter what your wishes were, it fell to your blood kin, and if they didn’t particularly like or accept your lifestyle choice then the partner was excluded. With the fear of destroying the institution of “traditional” marriage, the Federal Government spurred to action, passing the constitutionally odious Defense of Marriage Act to protect the Federal definition of marriage and allow the states to ignore Article 4 of the Constitution. [While many would jump to defend the concept through the Public Policy Exception, one must remember that the state needs a compelling public policy to ignore Article 4, and “We don’t like homosexuality” is not an actual policy.] Being excluded and discriminated against is what spurred the movement to seek equal marriage rights. If you remove the religious motivation behind the defenders, there is no valid argument. From a Libertarian standpoint the issue here is to have equality for all. Not allowing your religious view, which could be different from mine, and certainly different from every non-son of Abraham based religion, to dominate the debate is the point. “For the bible tells me so” as a policy position is always going to be met with resistance, as well it should be. From a religious freedom perspective, go ahead and dislike the concept, that is fine. Speak out, protest, do as you please, but when you cross into the secular arena you must yield. You can find a great deal of things in the Torah, the Bible and the Koran that are supposed to be practiced on a daily basis and imposed on the community as a whole. If you allow one, you make a case for allowing all. The point of religious freedom in this country is freedom of conscience: You need to be allowed to believe (or not believe) as you see fit, to not have a belief system thrust upon you, one that must be adhered to so as to be a citizen in good standing. Libertarians are not going to stand by and see someone discriminated against because they do not fit into the proper religiously approved lifestyle. Libertarians should never stand idly by while one group’s civil rights are being usurped by a narrow definition of someone else’s religious rights.

Tuesday, July 19, 2011

The Improper History of Tax Cuts and Budget Surpluses

What I hate more than anything is talking heads taking little pieces of history that reinforce their narrative, leaving things out of the larger historical context. The one that has me on edge at the moment is the whole “Clinton left us with a surplus and Bush squandered it with his tax cuts” line. This of course goes to the whole “raise the taxes on the wealthy to save us from our debt”. We keep hearing about “fair share” and how raising the rate from 35% back to the golden years of 39% is what is needed. The rich are doing so well why can’t we tax their ill-gotten gain to solve the problem? This plays nice to talking points, and in the tiny microcosm they want to focus on it may seem proper, yet it takes things out of their historical context to make the case.
Yes, Bill Clinton left office with a budget surplus, that is undeniable, and deserves some recognition, but this was not the result of some grand Liberal vision of the fair distribution of wealth. So we are clear, I am not an economist. To be completely clear, you could probably fit everything I know about macroeconomics in a tiny little thimble and still have room for all I know about astrophysics, Indian cuisine and women, but I can read. If you examine the Federal budget for the years 1995 to 2000 and the associated
This is not an attempt to laud George W. Bush, that isn’t ever going to happen here, but it is important to examine the whole package in our present debate. Federal revenues are crashing with a recession as he comes into office, and in an attempt to spur the economy he asks for tax cuts. You can, if you would like, disagree with the fundamental principles behind this, it is a free country after all, but the tax cut law was passed in June of 2001, and we all know what happened after that. The September 11th attacks essentially ended all economic activity in this country for over a month (remember the airlines and the insurance industry) which further depressed tax revenues. Then there is the build up for war in Afghanistan and the associated hand-outs and bribes that were necessary to attack a landlocked country in an unfriendly area, and your budget surplus is gone. Yes, when having the discussion we need to remember, and remind Republican blowhards, that in the years afterwards there are Trillions of dollars flushed away on Medicare prescription drug benefits and a war in Iraq and not many Republicans seem concerned with debt or future generations or anything else for that matter. All I am trying to say here is that to laud over this little nugget of “there was a budget surplus that was destroyed by tax cuts to fat cats” is disingenuous and never takes into account the full picture.
It is especially disingenuous when you fast forward to today and use it as your talking point on how we can simply have it all with the proper tax rate. The Federal budget is over $1.5 Trillion overdrawn this year ($2.17T receipts vs. $3.82T in expenditures is the White House estimate) If you look at the housing bubble and the 2007 capital gains taxes collected, even at the old Clinton rate, we would have still been overdrawn. If your answer is to include the affect of income taxes in the equation you have to remember that everyone paid higher taxes under Clinton, not just the rich, and no people in charge are advocating rolling back all the tax cuts. We are spending more money then we could possibly take in. At present the government is spending, and plans to continue to spend, 25% of GDP while collecting slightly over 14% of GDP in tax revenues. With 9% unemployment that revenue figure is not to be unexpected. But even under the Clinton tax regimen the government only collected 20.6% of GDP in tax revenue, the second highest percentage ever (and that was with the afore mentioned Tech Boom Bubble). So even with that 20.6% rate in place, if you could forward the notion it would have no negative effect on the economy as a whole, we would still be well overdrawn. Most projections have this disparity in percentage shrinking, yet staying in the negative for years to come (go
tax revenue you see some interesting things. If you look down the capital gains section you notice a 150% increase over that period. When you examine a table of just capital gains and taxes paid you see that there is a 187% increase in tax revenue paid on capital gains. What is with that crazy increase you ask? It is the Tech Bubble, remember that? I have a grand memory of it, because my friend and roommate at the time was a technical recruiter. Every day he would tell me stories of prospective job candidates demanding $100 per hour, full moving expenses and company credit cards, and they were getting everything they demanded. Things were definitely crazy at the time and employees and investors were riding high. Then the bubble burst when all those jobs were sent overseas. You can see that reflected in the 48% drop in capital gains tax revenue 2000 to 2001, which is almost exactly the same percentage drop in the budget surplus ($236B to $128B). Riding this bubble, coupled with welfare reform and keeping defense spending flat (and actually cutting in a few of those years) kept the Federal government in the black. This windfall did not last though, and this is where the complete historical package comes into play.here to check the associated charts for yourself). The only short term solution that would save face for everyone would be to ride some out of whack bubble again to bring a yearly budget back to near black (doing nothing about the $14T deficit), but save for that we need to spend less money across the board. There is no magic ideological silver bullet that will save us by only eliminating the EPA or only raising taxes on the Koch brothers. When we focus on the tax issue, or make the tax issue the central point, we miss the larger picture. The need to restructure spending and entitlements needs to be first and foremost in everyone’s mind. Hopefully we can stop spending money in Iraq and Afghanistan sometime pre-2020, but even if we do under the present system retiring baby-boomers are going to add that money and more into the Medicare and Social Security burden. Reality needs to set in not only in Washington, but with everyone at home; for until they start realizing not only the need for change, but what change entails, then dingbat politicians will continue to read poorly done polls about wanting higher taxes on “them” yet all the programs for “me” and somehow try to govern and lead without upsetting that ridiculous notion.

Friday, July 15, 2011

Debt and Taxes

Washington is all aflutter with the impending debt crisis disaster.  Republicans are staunchly sticking to their guns that we need “real” spending cuts with no tax increases and the President is so concerned that he raised the specter of Social Security checks not going out (with the added, and I am sure unintended, consequence of getting Granny on the phone to her Legislator).  Everyone was supposed to have an “adult” conversation about the debt, and all we get is a sideshow.  Make no mistake, this is what is happening, a circus sideshow with everyone attempting to score the political points necessary for their party to prosper in 2012.  Not only are we not talking about cutting any spending this year, which would involve someone creating a budget, they are going to try and implement their plans on a ten year window that can’t be enforced on future Congresses.  Sen. McConnell has gone so far as to forward eviscerating the Constitution by granting the Executive the power to borrow and spend whatever they want without Congressional approval. On the other side of the spectrum the Left somehow reads the 14th Amendment in such a way that the Executive branch is actually bound to borrow and spend money without Congressional approval, despite any notion of precedent, history or reality (isn’t it nice to have such overwhelming faith in one person to make all these “proper” decisions, strange no one thought of this in the “Reign o’ W.”).  All of these ridiculous shenanigans only reinforce the notion that none of the individuals leading this parade have any intention of doing anything but scoring points.

$14 Trillion in debt, that is what we are facing at the moment, over $1.5 Trillion this year alone.  Everyone’s long term plans have the U.S. running deficits like this for years to come.  Republicans throw out little budget nuggets of red meat to their constituents like cutting funding to the evil baby killers at Planned Parenthood or the left wing propaganda machine that is Public Broadcasting (please try and note the sarcasm in the preceding sentence if you would).  The President beats the drum of raising taxes on the evil rich and their corporate jets to fund our Green Jobs bullet train to future prosperity.  And in the end what affect would any of this have on the debt?  Minimal at best.  What many people have yet to realize is that cutting all the things labeled as “non-defense discretionary spending” (i.e. everything outside of entitlements and the military) would barely bring this year’s budget into balance and do nothing to address the debt.  To raise taxes on the rich folks from 35% to 39% would bring in about $70 Billion extra, which is a tad short of $1.5 Trillion.  Without seriously talking about cutting the Defense Budget and reformulating or reforming Medicare, Medicaid and Social Security there is no hope of balancing any budgets or reducing the debt.  The Republicans are standing back, on what they think is the cat-bird seat, waiting for the President to hang himself with his constituents talking about entitlement reform, while they themselves speak platitudes to reforming the system and nothing about Defense.

The tax issue is going to be the lynch pin in this debate, and no one is going to properly address this issue this time around, or anytime in the near future.  We keep hearing how the rich are doing so great, and that they could afford to kick in a little more, to pay their “fair” share.  There are some things inherently wrong with this whole line of reasoning.  First and foremost, it presupposes that the end result of your labors is not your own, that it belongs to the government, and they decide what is “fair” and how much you should keep.  Secondly, you are asking a segment of the population to pay a greater share into a system that you freely admit is broken.  How many articles have you read about government waste, fraud and mismanagement?  Every year there is a story about dozens of government agencies with overlapping and sometimes contradictory jurisdictions.  One of the selling points of the Health Care Reform Law was that it would end billions of dollars of waste, fraud and abuse.  Think on that for a moment: the government runs a program in which no one can properly estimate how much of the budget is flushed away in WASTE, FRAUD AND ABUSE, no idea, and no way to stop it (they are getting around to thinking about it) but it has to come in some sweeping yet to be realized format we can’t define.  Think on all the stories of missing billions in defense contracts, bridges to nowhere and checks to dead people.  Now you are going to tell a segment of society that they are doing so well that they should pay a larger share of their income into a system that everyone agrees is fundamentally screwed up beyond all possible comprehension.  Does that seem reasonable?  If you were one of these “rich” people would you want to step up and do your patriotic duty to pay more into the system?  Today the President spoke about how all the poll numbers say that a majority of people want to see revenue increases along with a long term deficit reduction deal.  Why wouldn’t they?  You are saying there is a debt problem, we need more money, and we will not take it from your pocket but someone else’s, and do all we can to keep your programs and benefits running.  As an abstract principle who wouldn’t sign on to that?  If you started from the premise of we have to raise everyone’s taxes to plug the budget hole left by the wildly inefficient and costly delivery of government services and programs, what would the poll numbers reflect then?  If a larger portion of your income was demanded to pay into a broken system that no one has an intention of fixing, what would your response be?

The same problems can be seen in the corporate tax system.  There is talk about removing subsidies, tax breaks and giveaways to the evil corporations who are sitting on so much money, not hiring people and paying so little into the tax coffers.  Now, any discussion of ending favors and breaks for rent-seekers fills my heart with glee, I would love to see them all disappear and let the market blow off some of the chaff from our system.  There is a major problem that once again involves the government and the backwards way they approach everything.  You can hold up any industry and say: Look at these fat cats and their tax breaks, this isn’t fair, let’s remove those perks and get them paying.  The conversation never gets to the end of that thread though, which is that those breaks exist because of the ridiculously high corporate taxes we have in this country.  The tax breaks and subsidies were put in place, for the most part, because these industries could not maintain a competitive edge with a 35% tax regimen, and instead of changing the tax structure the government passed out a freebie, so that these companies wouldn’t shutter their offices and reopen overseas.  Like any freebie the government shells out it has grown out of control, created a powerful constituency, and they have taken on lives of their own.  From the corporation standpoint, living in the shelter provided by the government, removing some of the elements of competition, they took full advantage and bended the system to suit themselves, as almost any individual would do when provided such a benefit.  Between taxes, regulation and compliance issues it is a wonder anyone keeps a business open in this country.

Pulling at little threads to fire up the base is not going to solve any problems.  There needs to be actual discussion of the necessary function of government going forward from this point.  We cannot start from revenue side of the problem, for it is a spending problem we are facing.  The government could drive up to the houses of Buffet, Gates, Zuckerberg, the Koch brothers and every other billionaire in the country, take everything they owned, leaving them on the corner with a tin cup, and we would not be able to balance this year’s budget deficit.  Then what would we do next year?  We need to rethink the size, scope and function of this government and what we expect from it before we come up with plan to pay for it.  This of course would take leadership, which is non-existent in Washington now and probably in the near future.  Republicans never seem to mention the $10 Trillion of the debt run up under their watch, and it seems that while the President may very well be as smart as everyone says he is, in terms of leadership ability, one would have to doubt at this point that he could lead a Frat House to quarter beer night at the local pub.

Sunday, July 10, 2011

The Marriage Vow and the Tea Party

I am often asked what I think of the “Tea Party” movement, and over the course of a few years, I have not been able to come up with an answer. Today I read The Marriage Vow signed by Michele Bachmann and Rick Santorum, supposed Tea Party favorites, and I have even less of a sense of this movement. There are so many peculiar things involved in this pledge, and it is so far reaching, that it truly boggles the mind. Sure, there is a token notion of deficit reduction, but the high handed moralizing instantly turns me off. We must never allow women in the military to hold an equal combat role, get people birthing babies at an accelerated rate, “protect” women from all the moral dangers of the world, outlaw pornography everywhere, make sure everyone stays in a monogamous married relationship, make divorce as hard as possible, ensure that religious protests over marriage and morality have their First Amendment rights especially protected (seemingly over others if you look at the porno provision), interfere with the concepts of Federalism by enforcing the Defense of Marriage Act, and of course, stuff all the gays back in the closet. If any or all of this is the Tea Party, I have no use for it. I wish to limit the power of the State, and most all of these provisions would need an incredible expansion of Federal power. How exactly does the Federal government monitor every pregnancy in the country to ensure that they are all properly carried to term? Do we hand out Federal life sentences for anyone performing an abortion (which of course would go underground into some seedy and dangerous practice)? And how exactly does being gay affect anyone else? If you remove the religious morality argument, what else do you have? There are many in this arena who throw out the phrase “Christian Nation”, Bachmann included, and that the concept of separation of church and state has no validity. I do not have the inclination at the moment to properly lambaste this, but I will leave it with this practical observation: If you ration out that as a majority of the moment you can legislate “Christian Morality” upon the people, what happens to this precedent when you are no longer the majority? When the Irish came to this country in the 1840’s, they were ostracized by the “natives.” They were seen as strange, many of them speaking a different language, with peculiar customs and practices, and most dangerous of all “papists.” They were discriminated against and fought to prosper for years. Eventually though, they became a majority in many areas, and through the power of the ballot box became the people in charge. Did they learn from this struggle that there is danger in not accepting new people into the American fold? Not really. When they were the majority, they treated the new Italian immigrants in a similar fashion. The Italians then struggled and increased their numbers until the ballot box provided them the power, and they could treat new immigrant groups shabbily, and so on and so on. What happens then if these “proper” Christians are no longer the majority? You have now set the table for the new group to start imposing their concept of morality on the entirety of the people. Wouldn’t it be better for all to leave the question of religious morality out of the equation? I would like to live in a country where my neighbor to the right can be an evangelical Christian, my neighbor to the left, a Shia Muslim, and me in the middle doing what I do, and despite that all three of us would quickly, and if necessary violently, jump to action if the State attempted to stop the neighbor across the street from praising the old Norse Gods or passing out a pamphlet saying religion was bunk. Enforcing a particular world view can only divide people, and it will do nothing to solve a $14 Trillion debt.
August 26th Update: Now Rick Perry has signed on to this ridiculous notion, so much for the 10th Amendment

Saturday, July 9, 2011

Introduction

Hello all. The purpose of this blog will be thought. The object of the exercise will be to examine the world around us through the prism of Libertarianism. This is not an attempt to shill for a political party. When I say Libertarianism I mean less a label or an organization to join, but a way of thinking. Labels and parties are what has brought our country to the state we are in today. Independents now make up a plurality of the electorate, mainly because there is no home for the moderate in either of the established parties anymore. The wings of each party now hold sway over the outcomes of legislation and policy, and when these two wings come to loggerheads as they often do, then things grind to halt and dissatisfaction with the process grows. To be a player in the larger game you must sign on to the party plank without dissent. To say the word Libertarian will bring derision from both ends of the spectrum, and there is good reason for that. The Libertarian mindset is one in which the power of government to directly impact your life should be limited, that the object of the exercise should be to create an environment for liberty and personal choice to flourish. Holding to this idea would destroy the moral crusades of each party. To stamp out poverty, provide healthcare for all, ensure you make healthy lifestyle choices, regulate all industry and business transactions, spy on everyone’s email, water board terrorists, keep you from watching porn or doing drugs all require an expansive notion of the state, one which presupposes government is the best tool for the job, and the politicians in charge can be trusted to “make the right choices”. This flies in the face of the founding principles of the Republic. The power of government was supposedly limited to keep these things from happening. Now, the argument can certainly be made that the world has changed, and it surely has, but the underlying principle of limiting government power should never be scoffed at. We should examine each action and intention not from the “good” that it could do, but the “bad” it could bring about. You might believe the Health Insurance Mandate is a necessity because healthcare is so important, so you do not want to question the constitutional validity of such a claim of power. What is important to ask though, is “what happens to that power in the next administration?” If you do not stand by the constitutional principle now, because you like the outcome, you will not be able to stand against it when you believe the outcome to be an encroachment on your liberty. Libertarians are characterized as being selfish, ill-suited to actually govern in society. Now, my position on being forced to buy Health Insurance I do not want might seem selfish: I do not care if it balances the budget, brings peace on earth, and provides everyone a lolli before bed, I will not be told to buy something by the Federal Government. This is not wrought out of selfishness though, it comes from a sense of fear. I fear what the government would do with this power if unopposed. And these same notions can be brought to both sides of the political spectrum. Libertarian ideals allow for an ideological consistency that is lacking in the Liberals and Conservatives, who wish to turn the power of government towards their own ends.
In writing this and future posts I hope that others will start to question their own beliefs on the nature of government and power. Maybe, as a result, people will start to ask more from their politicians then just platitudes and talking points, but if not we can at least have a little fun with this. All comments will be welcome, because the need to communicate and freedom to do so is what makes this country great, and so long as that exists we will continue to be a great experiment in liberty.